Solution to: Horse Trade
Consider the trade-story as if it describes two separate trades, where:
- In the first trade, the man buys something for $60 and sells it again for $70, so he makes a profit of $10.
- In the second trade, the man buys something for $80 and sells it again for $90, so he makes again a profit of $10.
Conclusion: The man makes an overall profit of $10 + $10 = $20.
You can also look at the problem as follows: the total expenses are $60 + $80 = $140 and the total earnings are $70 + $90 = $160. The overall profit is therefore $160 - $140 = $20.